Vestas Wind Systems AS (VWDRY) AI Stock Analysis

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Vestas Wind Systems AS

(OTC:VWDRY)

66Neutral

Vestas Wind Systems AS shows a solid financial base with strong revenue growth and effective cash flow management. The earnings call provided positive guidance, but challenges in manufacturing and safety concerns pose risks. The technical analysis indicates bearish momentum, and the valuation suggests the stock is moderately priced. Overall, the company has a strong growth trajectory but must address operational challenges to enhance its stock performance.

Vestas Wind Systems AS (VWDRY) vs. S&P 500 (SPY)

Market Cap

$13.25B

Dividend YieldN/A

Average Volume (3M)467.86K

Price to Earnings (P/E)24.8

Beta (1Y)0.69

Revenue Growth12.40%

EPS Growth554.81%

CountryUS

Employees35,100

SectorIndustrials

Sector Strength72

IndustryIndustrial - Machinery

Share Statistics

EPS (TTM)1.04

Shares Outstanding3,029,632,000

10 Day Avg. Volume801,850

30 Day Avg. Volume467,863

Financial Highlights & Ratios

PEG RatioN/A

Price to Book (P/B)N/A

Price to Sales (P/S)1.74

Price to Cash Flow (P/CF)N/A

P/FCF Ratio0.00

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price TargetN/A

Price Target UpsideN/A

Rating ConsensusN/A

Number of Analyst Covering0

Vestas Wind Systems AS Business Overview & Revenue Model

Company DescriptionVestas Wind Systems AS (VWDRY) is a global leader in sustainable energy solutions, primarily focusing on the design, manufacture, installation, and servicing of wind turbines across the world. The company operates in the renewable energy sector, offering a wide range of products and services that enable its clients to harness wind power efficiently. With its headquarters in Aarhus, Denmark, Vestas is committed to driving the transition towards a sustainable energy future by providing innovative and reliable wind energy solutions.

How the Company Makes MoneyVestas Wind Systems AS generates revenue through several key streams. The primary source of income is the sale of wind turbines and related equipment to energy producers and utilities worldwide. This includes both onshore and offshore wind turbines, which are customized to meet the specific needs of each project. In addition to turbine sales, Vestas offers comprehensive service agreements to maintain and optimize the performance of installed turbines over their lifecycle, providing a steady stream of revenue from long-term service contracts. The company also earns from the sale of spare parts and technology upgrades to existing customers. Strategic partnerships and collaborations with governments and other energy stakeholders further bolster Vestas's revenue potential, as they often lead to large-scale projects and expansion into new markets.

Vestas Wind Systems AS Financial Statement Overview

Summary

Vestas Wind Systems AS demonstrates strong financial performance and improvement across most metrics. Revenue growth and improved profitability margins are evident in the income statement. The balance sheet shows a robust position with no debt, though a high reliance on liabilities is noted. The cash flow statement reveals excellent cash generation and management, indicating a solid growth trajectory with improving operational efficiencies.

Income Statement

Positive

Vestas Wind Systems AS shows a positive trajectory in its income statement, with a significant increase in total revenue from $15.38 billion in 2023 to $17.29 billion in 2024, reflecting a revenue growth rate of 12.92%. The gross profit margin improved to 11.89% in 2024 from 8.34% in 2023, indicating better cost management. The company's net profit margin increased to 2.88% in 2024 from 0.50% in 2023, demonstrating enhanced profitability. However, the EBIT and EBITDA margins, while improved, remain moderate at 4.59% and 10.20%, respectively, suggesting room for further operational efficiency gains.

Balance Sheet

Positive

The balance sheet of Vestas Wind Systems AS indicates a stable financial position with zero total debt as of 2024, which is an improvement from $3.39 billion in 2023, enhancing its financial flexibility. The equity ratio stands at 14.32% in 2024, slightly increasing from 13.45% in 2023, showing a modest improvement in financial leverage. The return on equity improved to 14.15% in 2024 from 2.54% in 2023, reflecting a better utilization of equity to generate profits. Despite these strengths, the relatively low equity ratio indicates a high reliance on liabilities.

Cash Flow

Positive

Vestas Wind Systems AS exhibits strong cash flow metrics with operating cash flow increasing to $2.33 billion in 2024 from $1.03 billion in 2023, indicating robust cash generation capabilities. The free cash flow also improved significantly to $1.18 billion in 2024 from $135 million in 2023, a growth rate of 774.07%, showcasing effective capital expenditure management. The operating cash flow to net income ratio of 4.67 in 2024 underlines strong cash earnings compared to accounting profits. The company demonstrates excellent liquidity and cash flow management.

Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
17.30B	15.38B	14.49B	15.59B	14.82B
	Gross Profit
2.06B	1.28B	118.00M	1.56B	1.54B
	EBIT
794.00M	292.00M	-1.24B	322.00M	1.03B
	EBITDA
1.76B	1.13B	-545.00M	1.26B	1.66B
	Net Income Common Stockholders
499.00M	77.00M	-1.57B	134.00M	765.00M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
3.94B	3.32B	2.35B	2.51B	3.15B
	Total Assets
24.64B	22.51B	20.09B	19.71B	18.16B
	Total Debt
0.00	3.39B	2.43B	1.44B	1.35B
	Net Debt
-3.79B	-3.29B	75.00M	-958.00M	-1.69B
	Total Liabilities
21.10B	19.47B	17.03B	14.95B	13.46B
	Stockholders Equity
3.53B	3.03B	3.04B	4.75B	4.65B
Cash Flow		Free Cash Flow
1.18B	135.00M	-1.01B	120.00M	55.00M
	Operating Cash Flow
2.33B	1.03B	-195.00M	996.00M	743.00M
	Investing Cash Flow
-1.34B	-782.00M	-679.00M	-939.00M	-267.00M
	Financing Cash Flow
-478.00M	743.00M	846.00M	-715.00M	-234.00M

Vestas Wind Systems AS Technical Analysis

Technical Analysis Sentiment

Neutral

Last Price4.39

Price Trends

50DMA

4.69

Negative

100DMA

4.63

Negative

200DMA

5.76

Negative

Market Momentum

MACD

-0.11

Negative

RSI

46.02

Neutral

STOCH

60.05

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For VWDRY, the sentiment is Neutral. The current price of 4.39 is above the 20-day moving average (MA) of 4.37, below the 50-day MA of 4.69, and below the 200-day MA of 5.76, indicating a neutral trend. The MACD of -0.11 indicates Negative momentum. The RSI at 46.02 is Neutral, neither overbought nor oversold. The STOCH value of 60.05 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for VWDRY.

Vestas Wind Systems AS Peers Comparison

Overall Rating

UnderperformOutperform

Sector (63)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ETN	76 Outperform	$113.15B	30.22	20.23%	1.34%	7.25%	18.36%
CMI	74 Outperform	$40.39B	10.36	41.27%	2.43%	0.14%	444.36%
IR	67 Neutral	$30.22B	36.78	8.40%	0.10%	5.22%	8.01%
VWDRY	66 Neutral	$13.25B	24.83	15.25%	―	12.40%	554.81%
BWEN	64 Neutral	$33.26M	27.95	2.00%	―	-29.65%	-84.94%
Sector *	63 Neutral	$4.27B	11.40	5.38%	214.75%	4.10%	-8.98%
TPIC	40 Underperform	$42.23M	―	77.71%	―	-8.18%	-20.81%

* Industrials Sector Average

Performance Comparison

VWDRY

Vestas Wind Systems AS

4.39

-4.39

-50.00%

BWEN

Broadwind Energy

1.49

-0.72

-32.58%

CMI

Cummins

293.26

5.87

2.04%

ETN

Eaton

288.82

-33.53

-10.40%

TPIC

TPI Composites

0.89

-2.09

-70.13%

Ingersoll Rand

74.98

-18.33

-19.64%

Vestas Wind Systems AS Earnings Call Summary

Earnings Call Date: Feb 5, 2025 | % Change Since: -4.15% | Next Earnings Date: May 6, 2025

Earnings Call Sentiment Neutral

The earnings call presents a mixed outlook. Vestas reported record revenue and strong order intake, along with shareholder returns and sustainability progress. However, challenges in manufacturing ramp-up, service business costs, and safety concerns were noted. The offshore ramp-up is a significant cost burden impacting margins.

Highlights

Record Revenue and Strong Q4 Performance

For the full year 2024, Vestas ended with a revenue of EUR17.3 billion, marking a 12% increase year-on-year, and achieved an EBIT margin of 4.3%. Q4 was the best quarter since 2017, with a 29% revenue increase year-on-year.

Service Business Expansion

The service order backlog grew to almost EUR37 billion from EUR34 billion at the end of 2023, with service reaching 155 gigawatt compared to 149 gigawatt a year ago.

Strong Order Intake and Backlog

Order intake of 17 gigawatt added EUR19 billion in value, with a high ASP. The order backlog in Power Solutions increased to a record high of EUR31.6 billion, up EUR5.6 billion compared to last year.

Shareholder Returns

Vestas proposed a dividend of DKK0.55 per share and will initiate a share buyback of EUR100 million with immediate effect.

Sustainability Achievements

Lifetime emissions avoided by produced and shipped capacity increased by 59 million tonnes compared to the previous year.

Lowlights

Manufacturing Ramp-Up Challenges

Manufacturing ramp-up challenges in the U.S. onshore and in offshore are driving additional costs as Vestas prepares to deliver on a record order backlog.

Service Business Challenges

The service business faced rising costs, and a recovery plan is now in place following a challenging year in 2024.

Fatalities and Safety Concerns

2024 was marked by five fatalities, including one Vestas employee. Safety performance across the value chain needs improvement.

Offshore Ramp-Up Costs

The offshore ramp-up is causing significant investment and costs, impacting margins negatively, with amortization and depreciation increasing by EUR200 million.

Company Guidance

During the call, Vestas provided comprehensive guidance for 2025, highlighting an expected revenue range of EUR18 billion to EUR20 billion and an EBIT margin before special items anticipated to be between 4% and 7%. The company emphasized its strong performance in 2024, achieving a revenue of EUR17.3 billion and an EBIT margin of 4.3%. Vestas noted an order intake of 17 gigawatts, adding EUR19 billion in value, marking a record year. The service business, despite challenges, ended with an EBIT of EUR448 million and a backlog of nearly EUR37 billion. Vestas also announced a proposed dividend of DKK0.55 per share and a share buyback of EUR100 million. The guidance reflects continued investment in manufacturing and a focus on improving service operations, alongside addressing the challenges posed by geopolitical and market volatility, particularly in the U.S. and Europe.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.